On July 1, the Constitutional Court has reported, by means of an information note, that it has declared as unconstitutional the regulation of installment payments on Corporate Income Tax approved by the Royal Decree-Law 2/2016, of September 30.
The aforementioned regulation had introduced a series of modifications in the calculation of the installment payments for companies with a turnover of more than 10 million euros, for which the amount of the payment was increased, setting it at a minimum amount of 23 % of the accounting result, without the possibility of applying adjustments.
The Court's ruling addresses, first of all, the possible violation of the material limits of the Royal Decree-Law insofar as it cannot affect the rights, duties and freedoms of citizens regulated in Title I, among which is the "duty to contribute to the maintenance of public expenses".
The ruling reasons that Corporate Income Tax is one of the main taxes of the Spanish tax system, and that due to the important modification that it regulates and that affects the main elements of installment payment, the aforementioned Royal Decree-law affects the duty to contribute.
Secondly, the exception of unconstitutionality also raised the possible violation of the principle of economic capacity, but the Court does not address this issue when considering the first plea regarding the use of the Royal Decree-Law.
In the next few days, we hope to have the full content of the ruling and, on the other hand, to know the reaction of the Tax Agency regarding the calculation of forthcoming installment payments of Corporate Income Tax.
Originally published 08 July, 2020
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